CURRENT AFFAIRS

Detailed explanation-1: -NEW DELHI: Grappling with its worst economic crisis since the country got independence in 1948, Sri Lanka on Tuesday announced a default of $51 billion on foreign debt.

Detailed explanation-2: -In the fiscal year, 2022-2023, in July-September the debt and liabilities stood at Rs 62.46 trillion which is more than the same period of last fiscal year, accounting for Rs 50.49 trillion. The country’s debt rose 24.7 per cent to Rs59. 37 trillion, while total liabilities increased 23 per cent to Rs3. 56 trillion.

Detailed explanation-3: -As the import-reliant island nation’s Balance of Payments crisis spiralled and led to a painful economic crash last year, the government opted for a preemptive default on its $51 billion foreign debt in April 2022.

Detailed explanation-4: -The national debt of Sri Lanka increased significantly by 35.9 billion U.S. dollars (+70.75 percent) in 2022 in comparison to the previous year. Therefore, the national debt in Sri Lanka reached a peak in 2022 with 86.61 billion U.S. dollars.

Detailed explanation-5: -As a result, we now count eight countries as currently being in default on their international bonds – Venezuela (since 2017), Lebanon, Suriname and Zambia (2020), and Belarus, Russia, Sri Lanka, and now Ghana (2022); nine if we include Ukraine after its consent solicitation agreed to suspend payments for two years.